Affiliate marketing refers to an on-line revenue share system that involves advertising and selling. It started back in late 1994 when many e-commerce sites started implementing the system—and found it produced substantial and profitable results for both the affiliate and the merchant. Currently affiliate marketing is a proven marketing system that has become a serious player on the e-commerce stage.

With this system, a person who joins an affiliate marketing program partners with an e-commerce merchant (who offers a subscription, various products or services, a shopping site, etc.) and is offered payment through referrals from the affiliate’s website.

The affiliate doesn’t necessarily have to have their own website to market the merchant offers. The affiliate can link to the merchant through e-mails, blogs, RSS fees, etc. and referrals or sales can be generated through the following:

1) Pay-per-click systems. This is basically when the affiliate displays advertisements on their site and is paid by the merchant when a customer or internet user clicks on the ad.

2) RSS feeds or blogs (or even personal sites can come under this category). Nowadays, blogging in itself is a stead and true form of marketing and promotion. Blogs and affiliate marketing partner well within this form of on-line communication.

3) Comparison sites and shopping directories. These are also known as review sites or legitimate advertising sites. Affiliate links are placed on these sites so consumers can take advantage of the merchant’s offers.

4) Loyalty sites. This type of website offers a reward system through a cash-back or points-back system, or could also include charitable donations.

5) Coupon sites. These sites draw consumers by offering discount coupons. They focus primarily on marketing and promotions and so go well with affiliate marketing systems.

6) E-mail lists. These encompass legitimate e-mail lists to subscribers of the affiliate’s website and are not considered spam. (Spam is where unsolicited and unwanted advertising e-mails are sent to people.) The merchant’s offers are promoted directly to the e-mail lists subscribers by the affiliate.

7) A registration path. This is when a person registers with a specific site to receive a newsletter or subscription. Offers from other companies (like the one from the merchant) are represented and advertised on the site as well as those from the affiliate themselves.

Networks. There are many affiliate marketing networks. Some even function on a multi-tier or multi-level marketing sort of set up.